KARACHI: While Prime Minister Imran Khan on July 27 gave a go-ahead for crackdown on sugar barons, consumers faced a massive increase in sugar retail price of Rs93-95 per kg from Rs87-88 per kg, while over the last few weeks sugar was selling at Rs85 per kg in retail markets.

There appears to be no impact of the government’s decision on July 28 to allow import of 300,000 tonnes of sugar to control rising prices, maintain buffer stocks and prevent shortage in the coming months before the start of new crushing season.

Wholesalers blamed the sugar millers for increasing the prices while retailers held the wholesalers responsible for the price hike.

The patron-in-chief, Karachi Wholesalers Grocers Association (KWGA), Anis Majeed, said the millers had increased the price to Rs90-91 per kg from Rs82-83 per kg. Earlier this month, wholesale rate was around Rs78 per kg.

On the decision to import 300,000 tonnes of sugar, he said at a current rate of $370 per tonne (C&F) and one dollar equals to Rs168, imported sugar would cost Rs62 per kg while the current market rate was Rs93-95 per kg.

After adding Rs10 per kg in the transportation and other expenses, imported sugar would not cost more than Rs72 per kg to consumers, thus making imports feasible keeping in view the high retail prices.

As per figures of Pakistan Bureau of Statistics from 2013 till date, sugar import hovers between 8,700 tonnes to 12,126 tonnes every fiscal year, costing around average $500 per tonne.

However, Mr Majeed said imported sugar was mainly brought by pharmaceutical companies for preparing specific medicines. According to figures of large scale manufacturing, sugar production during July-May 2019-2020 fell by seven per cent to 4.876 million tonnes as compared to 5.245m tonnes, while sugar annual consumption hovers between 4.8m tonnes to five million tonnes.

Investigations fail in providing relief to consumers

It has been noticed that investigations against sugar barons have failed to provide any relief to consumers.

Around two months after the release of a forensic audit report on the sugar scam, the federal government on July 27 directed the relevant authorities to launch a massive crackdown on sugar barons and submit their reports in next 90 days.

Adviser to the Prime Minister on Accountability and Interior Mirza Shahzad Akbar after seeking consent of PM Khan wrote separate letters to the State Bank of Pakistan (SBP), Competition Commission of Pakistan (CCP), chief secretaries of Punjab, Khyber Pakhtunkhwa and Sindh, asking them to launch a crackdown on sugar mafia in the light of forensic audit report.

Published in Dawn, August 4th, 2020